The Islamic calendar is a lunar calendar, based on the revolutions of the Moon. The Muslim New Year is celebrated on the first day of Muharram, which is the first month of the Islamic calendar. New Year's Day is used to remind Muslims of the Hiraj or migration, of Prophet Muhammad from Mecca to Medina. It is a known fact that the actual migration did not take place on the first day of Muharram. It probably took place in the third Islamic month. The Islamic calendar itself was instituted after the actual migration. As a result of the association of the Islamic calendar with Hijrah, New Year's Day is important to remember the significance of the Prophet's migration.

The way the Muslims celebrate New Year's Day is very different from other such celebrations. They gather in mosques and offer special prayers and listen to special readings from the Koran. An important part of the prayer service is the narration of the Hegira or the flight of Prophet Muhammad from Mecca to Medina. Muslims are supposed to reflect on their life, the manner in which they are leading their life and about their own mortality. The day is spent in prayer and on reflecting on how one is leading one's life. There are no celebrations that we normally associate with New Year's Day. The New Year is known as Maal Hijra among the Muslims. Recently a number of Muslims have started sending greeting cards to each other on their New Year's Day.